Tombstones Are Produced in a Monopolistic Competitive Market

Multiple Choice

Tombstones are produced in a monopolistic competitive market. One producer, Rolling Stones, sells 20 tombstones a week at a price of $500 each. Its average total cost is $600. From this information, we can tell:

A) new tombstone firms will want to enter.
B) this producer is losing $2,000 a week.
C) this producer is making an economic profit of $400.
D) this producer should increase production.